By Alice Rathjen (Founder & President, DNA Guide)
My latest company DNA Guide is a physician/patient engagement tool for personal genetic data. We’ve built a full genome browser for the iPad and eventually want to offer an electronic medical record (EMR) solution that uses a person’s DNA for their user account and has a map of both their genome and their body.

Most Health 2.0 entrepreneurs have a similar story as mine. They or someone they cared about suffered from a disease and they want to change the world. We’re on a mission to create companies that force those responsible for our current health care system to change the way they do business or find themselves out of a job. It’s a path that involves dealing with patents, people and pivots in search of the perfect investor. Here’s the talk I gave at World DNA Day in China called “Navigating Genetic Data Regulation, Privacy and Ease of Use” and DNA Guide’s pitch deck.

Patents, Pivots and the Perfect Investor

Although generating intellectual property is a core competency of the Health 2.0 community, many of its innovators have disdain for patents. I am not in the category. One of the best ways to pull the rug out from under an industry is to own the patents for the next generation of products and services. If the early health hackathons had filed patents, the patient empowerment movement would have an endowment already. When a movement or industry orphans its intellectual property, it shows up later with a patent troll as its legal guardian.

In some ways, the Health 2.0 movement is like the early environmental movement. We’re in the free software and open data hugging phase, not realizing the need to acquire critical cyber real estate so it can be preserved for the larger community. My message to entrepreneurs is file your patents now and grant open and affordable access later.

Our first idea was a company called Dominga, providing personal genome management services. The revenue model was people paying to mail in a DNA sample and then logging on to get their disease risk and other recreational information. We planned online communities with the notion some users would consent to participate in research efforts to fuel discovery.

In 2000, we were unable to raise funding. We were too early, had no barrier to entry for online consumer genetic testing and people didn’t know why anyone would want a genome browser. We filed a patent and included the business plan as supporting documentation. The patent claims were for mapping genetic information 2D or 3D to either chromosomes and/or the human body with pan and zoom functionality. We also included claims for managing access to different views of the data. I’m glad we did.

Our patent wasn’t granted until late in 2006 as US Patent: 7089498. In the meantime, genome browsers visualizing one chromosome at a time proliferated around the world. In 2008, our invention made the cover of Time as invention of the year — only there was no mention of our issued patent in the article. That same year, a direct to consumer genetic testing company won most innovative company of the year at the World Economic Forum. It was time to pivot.

We did two things: create a holding company for the patent, Drisco & Clay, and a spin-off company, DNA Guide, Inc. to provide a genome browser designed for non-scientific users involved in the deployment of personalized medicine. Each pivot is like paddling out on a surfboard. You only need to catch one wave as the market matures to succeed.

Patents are important –- Good people, even more so.

People say choose your friends carefully. My advice is choose everyone carefully
#1 — Good Friends

The most valuable group of people in your network is a group of core friends. It’s the long term friendships, the people who know you well, that are your best source of encouragement and advice. Bottom line is the true angels are the people you can call who pick up your kid from day care when you’re stuck in traffic coming back from Palo Alto. Without them, there’s no company.

#2 — A Trustworthy Team

Getting people to work for money is easy. Creating a team that sticks together based on a possible reward in the future requires tremendous trust among all those involved. You need good people… Great people. Two of my co-inventors, Bill Kimmerly, Ph.d. and Xavier Thomas, have been working on this project off and on for ten years without pay. Saw Yu Wai, our lead programmer has put in over 400 hours of coding getting a map of a full genome working on all the major mobile platforms. Jeff Protentis, Deborah Kessler, Kris Kritzer and Alex Fordyce all made generous contributions of time and expertise. You need a team that will put in a few thousand hours of work based on good will in good faith.

#3 — Kind Strangers

Often when a startup succeeds, the credit goes to the founding team, CEO or lead investor. As the founder of pre-funded startup, I can tell you it’s the kindness of strangers that allows a startup to survive. It’s the people I approached “cold” who put in the effort to understand something that didn’t previously exist and then offered what they could to help make it happen that mattered. This list for me is so long that I made up an award and wrote a post to thank everyone who helped in 2010. I’ll do the same for 2011. Know how to spot kind strangers and be one yourself.

#4 — Mentors

For years, I carried around a list of my mentors in my wallet and when waiting somewhere would look over it. Just remembering each person would reconnected me to the gift of knowing them. The list started off with 25, then grew to 50, and it now needs to be updated to reflect about 100. My first mentor for the genetics project was Jack Harding. He taught me how to recruit advisors, prepare a funding deck and keep the deal clean. He coached me through my first big pitch to Brooke Byers at Kleiner Perkins in November of 2000. There’s been a lot of pitching since.

#5 — Advisors

Pick advisors as carefully as you pick the founding team. Find people who started your field and have a track record for being on the cutting edge of innovation. For DNA Guide, that person is Mark Boguski, MD, Ph.D. from Harvard Medical School. He immediately understood the significance of our technology versus the current bioinformatics tools in the marketplace. I didn’t even have to finish the demo before he offered to help.

The reasons why women have a hard time raising funding are complex.

One thing I wish that I realized earlier was that I was looking for the perfect investor.

We all know stereotypes are a bad thing. Most male entrepreneurs will take money from anyone and not think about it too much. Some women will also take money from anyone. I have been holding out for an investor that I enjoy, trust, admire and want to make a serious commitment to — try not to laugh. It’s as if I’m waiting for Marcus Welby, MD to show up as the perfect Health 2.0 angel investor.

There a part of me that’s like a wild horse. I’m not willing to let just anyone have a ride. At the same time, there’s something to be said for food and shelter. My last word of advice: the perfect investor doesn’t exist. Settle for the best real one you can find.

Editor’s note: Health information technology startups are encouraged to apply to DC to VC: HIT Startup Showcase, a competition open to any US entrepreneur seeking seed or Series A funding for startups applying cutting-edge technology to improve the quality and effectiveness of healthcare. Deadline to apply is August 9, 2011. For more info and to apply, click here.
Editor’s note: Got a question for our guest blogger? Leave a message in the comments below.
About the guest blogger: Alice Rathjen is the Founder of DNA Guide and DNA Classifieds. Alice won the Kauffman Foundation Women in Science & Engineering Business Idea Competition in 2011. She is the primary inventor of US Patent 7089498 and one of the early pioneers in consumer genetics. In 2000, Alice founded a direct to consumer genetic testing company called Dominga, and in 2008, she founded Drisco & Clay, LLC, for licensing the patent that resulted from Dominga’s multi-disciplinary efforts. Follow her on Twitter at @dnatimes.